How to evict HMO tenants

There are several reasons why a landlord might want to evict HMO tenants. While the benefit of investing in HMOs is the rental income and attractive yield achieved through multiple tenancies, the more tenants you have, the harder it is to create a harmonious household.

Tenant disputes, bad behaviour and rent arrears are often the trigger for starting an eviction process, and when managed correctly, landlords can often come to a resolution without going down the legal route.

The biggest challenge, however, is when you need to evict HMO tenants through no fault of their own or when terms of the tenancy have not been broken – which means you can’t use a Section 8 notice.

If you want or need to sell your HMO with vacant possession, serving a Section 21 notice is often your only option.

What is a Section 21 notice?

Landlords can serve a Section 21 notice to evict HMO tenants without giving a reason, provided it is more than four months since the start of the tenancy or there is a periodic tenancy agreement in place. Under normal circumstances (pre-pandemic), you would have to give two months’ notice.

If you have a legally compliant HMO with no improvement notices served on the property and followed all lettings procedures with regards to tenancy deposits, EPCs, How to Rent guides and gas safety certificates, this should be a straightforward process.

In some instances, your HMO tenant might not leave by the set eviction date, and you’ll then have to go to court and apply for a Standard Possession Order. This is where it starts to get costly for HMO landlords. To avoid situations like this, it’s always wise to be a responsible HMO landlord and give your tenants as much notice as possible so they can find alternative rental accommodation.

Unlicensed HMOs

Matters can get very muddied, however, if your HMO does not have a licence. Since October 2018, all HMOs let to five or more tenants from more than one household require a licence. If, for whatever reason, your licence was refused, you might think the best strategy is to evict HMO tenants to make it a smaller HMO or sell up entirely.

The Deregulation Act 2015 changed the law so a valid notice cannot be served to end a tenancy if the property should be licensed but isn't currently, and it may be considered a crime under the Protection from Eviction Act 1977 if you try to evict a tenant under these circumstances.

Tenants may also seek a Rent Repayment Order, which means as well as potentially being issued with a fine, you may have to repay rent for the period the HMO wasn’t licensed.

Instead, you may be able to apply for a temporary exemption (lasting three months) as long as you can prove you are taking reasonable steps to either; make improvements to the property to achieve a licence; reduce the number of tenants; convert the property back to a single dwelling; or sell the property. If granted, you may be able to serve a Section 21 notice.

Evicting HMO tenants to sell

If the reason for evicting tenants is because you want to sell your HMO, you may need to wait until the tenancy agreement has run its course and the property is empty before viewings can take place. While there may be a clause in tenancy agreements that stipulate tenants must accommodate viewings (provided notice is given and arranged for a reasonable time), tenants may choose to be difficult and refuse access.

Sell without evicting HMO tenants

The good news is you don’t always need to evict HMO tenants to sell your property. Instead, you can sell to HMO Buyer - a professional cash buyer happy to purchase with tenants in situ. Regardless of your HMO’s licensing status, we guarantee to buy any HMO anywhere, with or without tenants or partial voids.

Our reputable Property Management team will absorb the property into HMO Buyer’s own portfolio and apply for the correct licensing or exemptions so you don’t have to. Life for your tenants will go on with the minimum of disruptions, and you’ll enjoy completion on your HMO sale and cash in the bank within as little as seven working days. It’s the perfect exit strategy with no evictions needed.

If you’d like to know more about an instant cash offer for your HMO, get in touch with HMO Buyer today.